Intel’s recently departed CEO, Pat Gelsinger, is set to receive a severance package exceeding $10 million.
According to a filing with the Securities and Exchange Commission (SEC), Gelsinger’s “retirement and separation agreement” includes 18 months of his base salary of $1.25 million, totaling $1.875 million. He will also be awarded 1.5 times his target bonus, calculated as 275% of his base salary, amounting to $5.16 million. These payments will be distributed over 18 months via payroll.
Additionally, Gelsinger is eligible for a pro-rata payment equivalent to 11/12th of his 2024 annual bonus, approximately $3.15 million. However, this amount is performance-based and subject to conditions. Altogether, his minimum exit package is $7 million, with the potential to exceed $10.18 million.
Challenging Times
Intel has endured a difficult year, with its valuation plummeting 30% by August due to disappointing financial results. The company reported a net loss of $1.6 billion compared to a $1.5 billion profit the previous year and subsequently laid off 15% of its workforce, affecting around 15,000 employees.
While a $10 million severance might seem modest for the CEO of a $103 billion company, Intel’s market cap was more than double that when Gelsinger assumed leadership in 2021. Comparatively, other executives have received much larger exit packages, such as WeWork’s Adam Neumann, who secured over $400 million, and Yahoo’s Marissa Mayer, who left with $54.9 million in 2016 under challenging circumstances.
Reports suggest Gelsinger faced the option of retirement or dismissal. His tenure ended on December 1, after nearly four years, with interim leadership taken over by co-CEOs David Zinsner (CFO) and Michelle Johnston Holthaus (GM of the Client Computing Group). Intel’s board has initiated a search for a permanent CEO.
Intel’s stock initially spiked following Gelsinger’s departure but later stabilized, reflecting ongoing uncertainty as the company continues transitioning to a foundry chip-manufacturing model.”